What happened: Sega Sammy is nearing a deal to acquire "Angry Birds" maker Rovio Entertainment for $776M. The Japanese gaming giant, known for its Sega Genesis console and the Sonic the Hedgehog franchise, is seeking to accelerate its expansion into the mobile gaming market. Details: First released in 2009, Angry Birds was the first mobile game to surpass 1 billion downloads. It spawned multiple sequels, causing Finland-based Rovio's annual revenue to soar from 6.5M euros in 2010 to 317.7M euros in 2022.
What it means: Even then, Rovio has faced challenges replicating the original success of Angry Birds, potentially making the gaming franchise ripe for a takeover. Mobile game spending also fell from a peak of $86B in 2021 to $79B in 2022, signaling that people are cutting back on their gaming purchases amid a larger drop in discretionary spending.
Quotable: Serkan Toto, founder of the Kantan Games consultancy, said the Angry Birds franchise is known worldwide but "the brand is already past its peak." What's next: That hasn't stopped Sega Sammy, which will reportedly offer 9.25 euros for each share of Rovio, a 19% premium over Friday's closing price. Rovio’s board is backing the tender offer, with an expected bid to launch around May 8. |
